Energy Finance: German Solar Four Times Higher Than Finnish Nuclear Energy

Germany’s solar program will generate electricity at quadruple the cost of one of the most expensive nuclear power plants in the world, according to a new Breakthrough Institute analysis, raising serious questions about a renewable energy strategy widely heralded as a global model.

The findings challenge the idea that solar photovoltaic is a disruptive, scalable, “shelf-ready” technology with a cost advantage over nuclear. Energy analysts frequently point to Finland’s advanced nuclear project at Olkiluoto, which is seven years behind schedule and billions of dollars over budget, and solar in Germany as indicative of future cost trends working against new nuclear technologies and in favor of solar.

Proponents of Germany’s Energiewende, which now involves jettisoning the country’s nuclear fleet by 2023, argue that solar and wind can make up the difference in lost capacity. A straightforward cost comparison between the two programs over the same 20-year period, however, reveals the costs of this proposition.

The Finnish European pressurized reactor (EPR), with an estimated total cost of $15 billion, will generate over half as much energy as the entire existing German solar program, which will run to roughly $130 billion. The total cost of electricity produced by German solar will be 32 cents per kilowatt-hour versus 7 cents per kilowatt-hour for the Areva-Siemens nuclear plant in Finland — a more than four-fold difference. Two such nuclear plants would generate slightly more than Germany’s solar panels, at less than a fourth the total cost.

The $15 billion estimate for Finland’s Olkiluoto 3 reactor is based on fixed1 and variable costs ($0.02/kWh).2 The reactor will generate about 225 TWh in a 20-year timeframe,3 more than half of what all of Germany’s solar panels installed between 2000 and 2011 will generate over their 20-year feed-in tariff contracts.

The construction of Unit 3 of Finland’s Olkiluoto nuclear power plant — approved by the Finnish government in 2005 and built by a consortium involving the French company Areva and Germany’s Siemens — has come under fire for construction delays and cost overruns. The 1,600-megawatt project, which aims to meet 10 percent of Finland’s energy demand, is being built on an island in the Baltic Sea.

Initially expected to cost $4.2 billion and take four years to complete, Unit 3 is now estimated to cost at least $11.1 billion and will not enter into service before 2016.4 Olkiluoto 3 is the first of four advanced European Pressurized Reactors (EPRs), with others under construction in France and China. Finland’s project has been criticized as an example of “all that can go wrong in economic terms with new reactors.”5

German solar panels installed between 2000 and 2011 will cumulatively supply about 400 terawatt-hours (TWh) to the grid by 2031. Between 2000 and 2031 Germany’s electricity ratepayers will pay about $130 billion for the solar PV generation from these panels installed between 2000 and 2011 in the form of 20-year feed-in tariff contracts,6 at an average cost of 32 cents a kWh.

Moreover, solar panels do not last as long as nuclear reactors and also give reduced output as they age. After three decades a single nuclear plant with the same output of Olkiluoto would generate about as much electricity as all of the German panels installed in the last decade.7 Over its entire 60-year lifetime, the EPR will generate between 589-757 TWh, depending on capacity factor.8

Assuming a 0.5 percent degradation rate for solar PV cells (a widely used figure), the 24.7 GW of solar PV capacity installed in Germany will generate 786 TWh over 40 years, or 604 TWh over 30 years (solar PV lifetimes are commonly considered in the 25-30 year range),9 just a slightly higher output range than that of a single EPR. After a 30 to 40 year period some panels may continue to generate electricity but most will be taken offline or replaced, and owners will incur new capital and installation costs.

Over its entire 60-year lifetime the EPR will provide electricity at a rate of 3.5-3.9 cents per kWh, compared to 16.5-21.5 cents per kWh for solar panels over their 30-40 year lifetimes.10

Alex Trembath is a policy associate in the Energy and Climate Program at Breakthrough. He is the lead or co-author of several Breakthrough publications, including the 2012 report "Beyond Boom and Bust: Putting Clean Tech on a Path to Subsidy Independence" and "Where the Shale Gas Revolution Came From." Alex is a graduate of University of California at Berkeley where he received his Bachelor's in Environmental Economics and Policy. While at Cal, Alex was active in the Berkeley Energy and Resources Collaborative and California Lightweight Crew. In 2009, he worked at San Francisco City Hall on local cleantech and community development in the Mayor's Office of Climate Protection Initiatives. He has worked on several political campaigns, including Gavin Newsom's gubernatorial run in 2009 and Organizing for America. Alex completed a policy fellowship with Americans for Energy Leadership, where he wrote on U.S. energy policy and politics. He was a 2011 Breakthrough Generation Fellow, contributing research on the collapse of federal funding for clean energy technology. His research has been published by the Breakthrough Institute, Americans for Energy Leadership, and the Information Technology and Innovation Foundation, Forbes, the Huffington Post, the National Journal, and the San Francisco Chronicle. He also writes regularly for The Energy Collective. He has lived in San Francisco for the last ten years, and is a proud son of South Bend, Indiana. He enjoys rowing and exploring the Bay Area. Follow Alex on Twitter @atrembath.

Stupid comparison and discussion. Just propaganda for Nuclear. The starting-point of this comparison is wrong and with that every further discussion. It is wrong to make a comparison for 20 years. Nuclear waste will take much more than 20 years.

One thing we know about nuclear power, the cost will always be going up, up, up. One thing we know about solar power, the cost will continue to go down, down, down. One of the reasons solar panel manufacturers are having such a difficult time right now surviving. But, add the cost of storing nuclear waste for between 10,000 and 1,000,000 years and I think any comparison is at best humorous and at worst arrogant ignorance.

The notion that the cost of nuclear will go up (faster than inflation) is non-sense. It is an extrapolation from a time when we were adding rigorous new safety regulations and standards and when construction of power plants of all types slowed way down (due to flattening electrical demand), thus, destroying the economy of scale for the newly redesigned nuclear plants.Times have changed. Nuclear power has a proven track record of being the safest form of high penetration energy production. We don’t need to tighten nuclear regulations; we need to make them more cost effective. We have an urgent need to replace all of our fossil fueled electric plants with sustainable replacements; as a result nuclear can once again grow and see cost reduction through economy of scale like renewables.The new reality is that the cost of wind power has hit bottom (with 282 GWatts deployed world-wide, it is much more mature than Gen III nuclear), and solar will hit bottom very soon. Thereafter both will increase in cost rapidly with market penetration due to the need for expensive energy storage and long distance power transmission.Dire warnings about high cost of storing nuclear waste also ignore reality. We would be better off spending the money safeguarding the waste from coal plants and solar PV module production (which by the way, will be hazardous forever and are enormously greater in quantity than nuclear waste).

Fukushima. Has anyone tallied the cost of that little nuclear disaster? Oh, and by the way, it’s still on-going. They are already discovering thyroid problems in California and the West Coast. But why bother calculating that little cost in the equation. After all it will never happen again, right?

AGW will proceed unabaitedand CO2 level will go up way past the recent 400ppm level because so called Anti-Global warming Renewables Activists are going to get us trapped in a position where we’ll spend ourselves to oblivion and still not have the carbon free/ low carbon energy that we need to displace FFs.Thanks to their otherworldly faith in renewables (without storage) and irrationally blind hatred of nuclear power.

I know little about nuclear tech, but as an engineer/scientist in another field, I have some observations. The reactors that were flooded in Japan were designed in the 1950s and installed around the world starting in the 60s. I also understand that although these reactor were produced by private companies, the design flowed out of military research intended to produce bombs…where producing Plutonium was considered a benefit. Even then there were safer designs for commercial power, but they did not get govt subsidies. It was deemed important to have a civilian benefit derive from the military expenditures.It would not seem too difficult today to design a reactor that was failsafe if it become too hot…that is not need human intervention to cool the reactor with water or to remove rods to stop the reaction.The setup in Japan where outside power was needed to pump water if there was a problem, certainly does not seem smart. But to have the backup generators so close to sealevel was just plain criminally stupid.Wastes from present nuclear power plants are certainly filled with unknown costs. But other designs seem on the boards that would eat much of the current wastes being stored. This does not eliminate the long term storage issue, but it sure sounds like it would lessen it. And yet other designs being proposed are reported to produce no long term wastes…Travelling Wave Reactors, Thorium etc. All the above may not be proven. However, it sure seems wise to being be at least making investments to test such technologies.Pilot reactors could cost 10s of Billions,perhaps, to try new nuclear generation schemes, but this seems a lot less expensive than forcing into production power generation modes that are far from economical with mandates and subsidies .. intermittent renewables that are still far from competitive with say natural gas fired plants. And to go a bit off field, forced use of corn alcohol for cars.In the meantime, cheap natural gas and better efficiencies will continue to lower the carbon footprint in this country and other developed countries…and produce great political benefits in that many of our intractable enemies depend on high oil prices.

TSvi Howard Epstein,One of the mistakes I think many people make is believing it’s all or none. For example, why is it so hard to have solar power as the main energy source and natural gas and even coal as backup energy sources when needed? Until nuclear is as safe as solar, I can’t see going down that path. Call it the ‘prevention’ principal. There will always be Black Swans like Fukushima and it’s not good enough to argue that it can’t happen anywhere else. It will. Again, I simply do not understand why it is so difficult to take the safe, obvious route instead of the much more dangerous and expensive one.

Well there is plenty of support for solar (and wind) in the west. Already in excess of $200B has been spent on solar and perhaps in the region of one billion solar panels have been installed worldwide. Yes you read that correctly, one billion PV panels have already been installed.The result, less than ~100TWh annual production compared to ~2,700TWh from the worlds nuclear fleet (vast majority built a generation ago).Solar cheer leaders point to an exponential growth and expect it to continue, reality is nothing can continue to grow exponentially and current solar will hit a wall in its growth before it can even exceed old nuclear.To grow more than that solar needs a world grid but that seems to fly in the face of many solar cheer leaders who imagine pico grids bolted onto your roof is going to generate the worlds 10s of thousands of TWh of demand. Impossible.

I K, your argument is either that of a defeatist or an oil and gas front man. In San Antonio, TX, Nexolon America is building a 400 megawatt solar plant that will power 70,000 homes, building a solar panel manufacturing plant and creating over 800 jobs paying in excess of $44,000 a year. They have a power purchase agreement already in place with CPS Energy.

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mslowiiko

May 20, 2013 03:35

It’s interesting – there seems to be some fear deep down in that comment. The word “Impossible” at the end of it draws attention.For the record, I work at a nuclear reactor, as an engineer. I was once a fan of nuclear, until I realized how hard it is to gain public support for new nuclear. Last year, US generation of renewables (without hydro) was 28% that of nuclear. This year, that share is going to be ~40%. Before the end of the decade, renewables will outsize nuclear in the US.Nuclear will have its future – in the second world. Russia, Saudi Arabia, Turkey, Jordan, China, India, all will grow their nuclear fleet – because they need any and all sorts of power. Power consumption in the US and in first world countries will not grow – and we will retire our coal fleets. First world nuclear fleets will add minimal capacity, mostly just offsetting the retirement and decomissioning of older plants.It’s interesting you chose a 10% capacity factor for solar – why so low? It can be as high as 40% depending on the usage. Albeit – nuclear should have a much higher capacity factor as well (can be over 100% nameplate capacity, depending on design, etc.)It was definitely an interesting article, but you should at least flirt with the idea that rooftop solar power (and large solar installs in Cali, Nevada and New Mexico) will offset any new demands for nuclear power, ever so slowly.

What part of the reactor do you work in and are you superman or iron man becuase normal man would not survive working inside a reactor. But forgetting for a moment that you prpbably dobt work at a reactor, if you read my other comments you will see that I am pro solar and think ultimately in the long term a global grod and solar is the most lokely solution. Anyway reactor man, the reason I used 10 percent is becuase that is the fleet average of the worlds largest solar installer. 40 percent capacity factor with PV, You’re going to have to prove that. Regarding USA green production its about 4.5TWh from solar and 145TWh from wind vs 800TWh from nuclear. That is less than 20 percent of nuclear. Wind could reach 800TWh and match nuclear, at a push, but solar cannot. It is indeed impossible outside of fantasy

Paul O, peak power usage is during the day. I have said all along that we can start by using solar when it is at its best, during the day and, at night, use what we are using now, natural gas, coal, etc. until solar science takes care of any issues. That’s what CPS will be doing. Why people think it has to be all or nothing is beyond my comprehension. If we start to use solar during peak times, we already cut coal, nuclear, etc.usage by 2/3rds. Use wind power at night and to fill gaps first and you cut down on polluting industries even more, right now. I would say that is substantial and it wouldn’t take long before other ideas surface. If we can make our energy power sources sustainable, then our lifestyles can continue to improve and grow. If we continue down the path we are going, science indicates we are headed toward extinction. Am I the crazy one here?

The problem is that solar and wind cheerleaders don’t grasp the fact that after a certain point, it gets exponentially more difficult to add more solar and wind. As a result any nation that takes the solar/wind route will find itself stuck with mostly fossil fuels.So if your aim is to cut FF use by a meaningful number (say >50%) then sadly solar and wind can’t achieve this and as a result they give false hope. Whereas nuclear is capable of a 50% cut in FF usageGermany is credited as the success story of solar but it will only generate about 6% of her electricity from solar this year and that is after more than $100B has been spent. More importantly that is 6% of electricity, 0% of heating, 0% of industry and 0% of transport. Overall that 6% is closer to 2-3% of primary energy needs for $100B. And that is an investment in a constantly decaying power source, another inconvenient truth the cheer leaders like to forget

Worth noting that just Four EPRs at one nuclear power station would produce the same annual energy output as about 65GW of solar PV in Germany.Currently the Germans have a little over 30GW of PV so not even half of one quad reactor nuclear power station. Not much of an energy revolutionThe worldwide solar PV installed of about 100GW is not even equal to two nuclear power stations running quad EPRs

So in the end, you do want to keep FFs and CO2 pumping into the atmosphere ?What I am saying is that any hard look at Nuclear power will note that it produces almost no CO2, and Very few deaths/illnesseswhen compared with other sources of power.I do conceed that current commercial nuclear technology is by no means ideal to my thinking. We know how to build nuclear plants that areWalk away safe andIt is stupid that we have not done so.I do blame paranoia generated by anti-nuclear forces for helping stunt the development of the very Carbon Free kind of power that they say that we need.I favor nuclear power because is it is a source that we ourselves control (not farmed from Mother Nature), and we may situate it wherever we see fit (even off the planet on Mars for example) and we can increase its output, day or night, and in any season of the year as per our needs. Lastly, It is also a direct replacement (and displacement) for FF based power, both Thermal and Electrical.I also think Nuclear waste problem is really a red herring. What we call waste is actually fuel for MSR’s like LFTRs. I definitely don’t want to see Nuclear waste buried, it would be a horrible waste of a valuable resource.

hmmm…. just a few reasons:1) solar will never be the main energy source. it does not have the energy density to supply our needs. It would be helpful if solar fans would stop saying that it will despite the fact that that opinion ignores both the expense and physical reality. (solar has 1/5000th the energy density of natural gas per m^2)2) to keep fossil as back up you need to have it running as spinning reserve. at the moment there is no black start tech in fossil except fuel cells which are even more expensive than solar. (the reason expense is important is the more expensive your energy the lower the standard of living and economic growth)3) even if solar were sufficiently dense if we tried to solve the problem with solar today it would lead to a massive worldwide increase in government debt or a severe recession or both.4) we just blew by 400ppm which puts us on track for a 1C increase. we are on our way to 550ppm by 2025. so essentially if the trend continues past that point we can expect a 6C rise in temperature with the loss of most coastal areas by mid to late-century. Basically think the southeast asia tsunami everywhere.5) nuclear reactors are at the moment the only tech we have ready to go that can solve the problem. of course if we wait a few more years even that will not do the trick. the reason for this is we have spent 20 years wasting our money on solar. which we continue to do basically because of conversations like this that have a loose relationship with fact.Basically this solar stupidity is digging us a very deep hole and the longer we continue not having a discussion of the facts of reality as the author was trying to do the deeper the hole will be.

subject is Germany and the solar farms in germany have capacity factors of ~8-9%. he was being generous. Portugal has about 11-13%. There is no such thing as solar with a capacity factor of 40%. Even on the equator with no clouds all year you would be lucky to get above 20%. I think you mean efficiency which is not what the author is talking about.

and the only reason they are building it is the installation will be subsidized at a rate of 60+% of total cost. sans subsidies no one would put a single watt of solar anywhere for energy generation. It is great for stuff like big belly and parking chargers. it is useless for generation.power out of that plant raw cost would be over $.20 kWh and it will occupy something like 4000 square kilometers. an NG plant would have a $.06 kWh cost and occupy far less than a single square km.IK is not shilling. He just understands the physics. Continued whole hog solar will guarantee climate change. If that is what you want keep living in fantasy land.You cannot spend 80% of your available dollars on something that not a single non-solar study say says will do much of anything and hope to solve anything.

My suggestion was that we should be trying nuclear techniques that on paper seem superior in the sense of being failsafe, eating much of the present wastes and those that are not supposed to produce long term hazardous. Likely would take more than a decade to prove or find problems. Cost would be much less than has been spent so far on forcing into production mode renewables that are still far from economic.Not thinking all or none…maybe you are not suggesting that I was. Solar and wind with storage already win economically in some places, namely those far off grid. Also solar is competitive when its high output times match peak usages and new Peaker Gas Generators can be prevented from being needed…but this coincidence is the exception rather usual for most places. Also some economic benefit can be assigned to have distribution power, that is rooftop power for backup against regional outages…naturally caused or caused accidentally or on purpose by people. But this still does not seem to bring the economics close to gas fired plants on any scale. And as others point out intermittent sources cannot produce a high fraction of our total electrical power.I pay 10% extra for “all wind” power, but this is on top of many other subsidies. In truth, our power company has much, much difficulty integrating power from wind farms and has refused to accept it for months at a time in spite of mandates requiring they buy it…because they needed to produce hydro power to protect fish. And they are building new gas peakers so they can accept more intermittent power as required, even when hydro can be limited. I can feel more green, but the real benefit of my decision, which led to more wind farms as intended, is less than clear by hindsight.

Howard,Fukushima has its back-up diesel-generators and auxiliary transformers on the sea side, instead of inland on a built-up surface, out of seach of any tsunamis.After I saw the aerial photographs, I could not believe the layout; bad without tsumanis, far beyond rational with tsunamis.To-day’s cars are so much better than 50’s cars. To-day’s nuclear plants would be so much better than 50s-60s nuclear plants.http://theenergycollective.com/willem-post/191326/deaths-nuclear-energy-compared-other-causes

There has been counter-claims that the cost calculation here doesn’t take into account the fact that new solar is a lot cheaper now, and therefore is irrelevant and false for today’s situation.It’s true that the number now is a lot better, but it’s still as expensive as the Finnish reactor (and doesn’t provide power all day long, so at large scale requiring costly storage).This recent document from BMU shows that in 2012 there has 19.5 billions Euros in renewables investments, out of which 11.2 billions for solar. The capacity added as published by Fraunhofer is from 24.28 GW to 32.44 therefore 8.16 GW. It will using above numbers generate 200 TWh in 30 years.This gives a cost of 4.1 cents per kWh, but thanks to cheap chinese panels which have had recently a very worrying rate of defect and may not generate electricity for 30 years. Labor is already most of the cost of installing a rooftop panel, the Chinese surplus will now stop given the recent bankrupcies, so it’s quite unlikely that the cost will really go down a lot more.

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paulzubrinich

September 9, 2013 16:19

That is astoundingly disingenuous to average out the cost of solar PV from 2000 to 2011 – especially for a study carried out in early 2013! What a poorly conducted and overtly biased study. There are some absolutely ludicrous numbers cited in these comments as well. I find it interesting how people with certain beliefs/agendas all cite each other’s fallacies in a big circle. Anyone who has followed German solar PV system prices for even a brief period of time knows how much the cost has plummeted and continues to fall. It’s a classic trick of lobbyists to average the cost out to hide that reality and bamboozle the less well-informed.I am also curious as to what figure, if any, was used to cost out the hazard of a nuclear accident. Naturally a balanced comparison would factor in the public health risks of each technology. I do not see any analysis in this regard here – perhaps because one technology poses a far greater public health risk than the other.Perhaps the author of this article should disclose any conflicts of interest he may have. My conflict of interest: I have clients in the solar PV industry.

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paulzubrinich

September 9, 2013 16:32

To put my previous comment into perspective, in just seven years small-scale system prices in Germany fell from €5,100/kWp (Q2 2006) to €1,698/kWp (Q2 2013), shaving off a full two thirds of their cost. Averaging prices all the way back to 2000 can only be viewed as utterly biased analysis. It cannot be taken seriously.

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Observer360

October 18, 2013 09:01

Does the cost of the Finnish plant include a timetable and reserves for total decommissioning, debris removal, permanent storage of waste generated, site restoration and funds to pay for any damage or remediation attributable to the plant, whether caused by natural disaster or plant accident or operation? Are provisions for “stranded costs” and under-assessment of power costs included and disclosed? Is market-based insurance for damages in the event of adverse occurances in place and inculded? Is any national Finnish legislation in place which requires Finnish taxpayers to pay for any costs or damages not covered by insurance or by project or Finnish nuclear industry reserves? How is permanent nuclear waste storage provided for, including perpetual funding? If not, then aren’t costs understated? These are problems associated with U.S. nuclear plants, and probably with all other nations’ nuclear installations. See, e.g., the Price-Anderson Nuclear Industries Indemnity Act, in its Wikipedia article. The plant description says it is on an island. How can the public monitor whether nuclear waste or spill material goes into the surrounding water and air? An island is a convenient way to exclude public and journalistic access and information-gathering, under claims of security. Three-Mile Island, Fukushima and Chernobyl have not been cleaned up, and may never be. Solar, wind, geothermal and biomass have none of these problems, do they?

I’m not sure how Finnish costs are calculated, but in the US, the levelized cost of nuclear power always includes decommissioning (returning the site to green-field status) and permanent waste storage (note that postponing permanent nuclear waste storage, as we have done in the US, makes it cost less and decreases the ultimate land use by allowing the waste to cool). According to the US government EIA, power costs for new build plants is expected to be: geothermal is $0.089/kWh, and nuclear is $0.108/kWh. They list a cost of wind of $0.087/kWh and $0.144/kWh for solar PV, but they note that these are “non-dispatchable”. If wind or PV included energy storage (which would be needed if we stopped using fossil fuel, hence is the better comparison with nuclear), the cost would be roughly that of solar thermal (which costs about the same, with or without storage) of $0.262/kWh. Biomass is simply the worst possible way to power a modern society, since it has absurdly high land use (in addition to the inevitable soil nutrient depletion). According to David Mackay’s excellent book, when biomass is burned to make electricity, the average annual energy yield per unit land area is only 0.2W/m^2. This means that each gigaWatt of power (and the US uses about 500 of these) requires 5,000 square km of land (1922 square miles). Biomass power (for electricity or liquid fuel) destroys ecosystems and drives up the cost of food. The Earth has three large, inexhaustible energy sources: solar, wind, and nuclear – all of the others are tiny and we are better off ignoring them.

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Brian Donovan

May 13, 2014 21:19

since 2000 for solar? You realize how that makes solar look more expensive right? what was solar cost in 2000? 8$ per Wp installed?
Now it’s less than 2$ per Wp installed, and getting cheaper.
Solar panels last a lot longer than 30 years. 1.6GW nuclear is replaced by say 16 GW of solar in totals energy per year.
At current prices for solar, that’s less than 32B$ NOT 130B$. See what using old costs for solar does?

No major agency puts the cost of nuclear below 8 cents per watt, and most put it well over 14 cents.

Did you include gov break and protection from liability?

Solar panels last as long or longer than nuclear reactors, and reactor need major retrofitting to last 60 years, which is not safe.
Sounds like you are confusing the feed in tariff for the actual cost of the solar power.
At 2$ per Wp installed, costs about 6 cents per KWH over 30 years. But panels may last 100 years. http://solar.gwu.edu/Research/EnergyPolicy_Zweibel2010.pdf